USD/CHF Weekly - May 28, 2012

The break over the January 6th to January 17th strong resistance zone and then 0.9500 psychological level has strengthened the near term bullish outlook and we expect further upward moves during the coming days.

On the upside, above the recent 0.9611 and then some resistance near 0.9620, we expect further upward gains first towards 0.9775/0.9785 resistance zone of mid-January and with a break of that towards the psychological resistance level of 1.0000. Please also note that before 1.0000 level, near 0.9940 should bring the resistance of the Fibonacci 61.8% retracement of the downward move from May 30th, 2011 to August 7th, 2011.

On the downside we would expect strong support near 0.9500/0.9490. This previous psychological resistance should now work as support. Any break below this would make our short-term outlook neutral and in such case we would expect some more downward consolidation towards 0.9420 and then 0.9368, previous support. Any break below this will also indicate a decisive break below 22-day EMA and will dampen even the near-term bullish outlook. The supports below this level are expected near 0.9239, resistance of March 14th which should now work as support.